iPad vs. Kindle: It’s Way Too Early to Tell

What is it about Apple announcements that causes otherwise sensible people to say or write really silly things? Most of the experienced observers present at Wednesday’s iPad announcement reserved judgment for the perfectly sound reason that what we saw was a very attractive piece of hardware whose software and , perhaps more important, back-end services are too incomplete to assess.

The fact that Steve Jobs gave only the sketchiest outline of the iPad’s ebook capabilities and told us even less about the iBook store did not prevent a fierce debate from breaking out over whether the iPad will or will not kill Amazon’s Kindle. Now this argument would be fundamentally misguided even if we knew a lot more about the iPad. It is a peculiar conceit of the tech industry that any new product has the be evaluated as the potential killer of some existing category leader, completely ignoring the very real prospect that both the incumbent and the challenger might prosper. For example, I think it is entirely possible the Kindle and other e Ink-based readers continue to be the choice of voracious readers of fiction and mostly text non-fiction, while the iPad wins the market for textbooks and multimedia newspapers and magazines.

But I digress. What really puzzles me is the tendency of analysts to come to firm conclusions based of the flimsiest of evidence—or perhaps none at all. Consider Ben Elowitz’s Tech Crunch guest post “Top 10 Reasons The Apple iPad Will Put Amazon’s Kindle Out of Business” especially, reason #4:

“Apple has captured the magic of shopping. Once again, whereas Amazon does great with the functional needs of buying a book, Apple goes beyond to create an experience.”

Now for all I know, shopping at the iBook store will turn out to be a positively orgasmic experience. But neither Elowitz nor I have any idea of what it be like because the iBook store does not yet exist. All we have seen is a static demo the user interface—and one that it is hard to imagine what it will look like when hundreds of thousands of thousands of titles are offered. I can accept the idea that some readers will prefer iPad’s glitzy finger-swiping user interface and animated page turning to Kindle’s prosaic but practical button-pushing. And some will favor the backlit LCD display over Kindle’s e Ink. But it’s much more of a stretch to believe that Apple will turn out to be vastly better than Amazon at selling books.

One thing that Apple and Amazon have both done superbly is the integration of their online content offerings—music, video, and apps for iPhone, books for Kindle—with the devices. But no one comes close to Amazon;s ability to market books. Only Amazon has been smart enough to send me an email when an author whose work I have bought in the past has a new publication. No one else’s recommendation engine (except maybe Netflix’s) come close to Amazon’s.

Another huge question left unanswered by the Apple presentation is the fate of the Kindle reader on the iPad. Now that Apple is entering the book business, will it allow Amazon (or Barnes & Noble) to compete, especially given the rumblings from the publishing industry that the iBook store may charge more for the same titles than Amazon.

One interesting dimension of the competition is that Apple and Amazon come to the book business from complete different perspectives. For Apple, content is the lure that gets customers to buy hardware. For Amazon, the devices are vehicles to sell content, which is why it doesn’t much care whether you read your Amazon ebook on a Kindle or an iPhone or a computer.

It’s way too early to declare a winner in this competition, or even to come to the conclusion that there will be a winner. My guess is that both Apple and Amazon can prosper in a rapidly growing market. But I’ll be the first to admit that it is nothing but a guess.

This is a fair and analytical post – and thanks for the callout on what I wrote.

Ultimately, the Kindle and iPad are very different devices in very different categories. I’m impressed from the iPad demo and first-hand “demo pit” accounts that it is a game-changer as a new format and device. Yes, it will take real use to asses, and multiple versions of enhancements to make it perfect – but the pre-launch v1 gives a hell of an impressive demo already. With its attractive design, form factor, capabilities, apps, and technical abilities (e.g. long battery life), it’s an easy bet that this is a device and a whole new category that consumers will embrace.

And that absolutely will come at the expense of purpose-specific devices like the Kindle.

Kindle may still sell some number of units for those who are looking for a dedicated (and excellent) e-Reader. But I’d put money that Apple will capture a far, far greater opportunity (in units, dollars, brand, and appeal) with the iPad for mass penetration than the Kindle will with discriminating readers.

If i break the market down one more level I see a crack in the Kindle market, the Kindle DX is vulnerable. As a Kindle II owner and fan I can’t see the iPad replacing that and that category in the short term, the price point, convenience and so forth are strong. Just too darn easy to use and the Amazon marketing is very strong (although Apple isn’t a slouch at marketing). Long term? Well I believe color and interactivity will win out (I am not declaring the iPad a winner here but color and interactivity is the winner)

The iPad can take on the other larger form factor readers, such as the Kindle DX and will be very well positioned but likely having comparable capabilities and color will become the new entry point very soon. The real winner? Consumers.

BTW, >90% chance I will buy an iPad, but hey, I’m a real technophile and have an iPhone 3Gs and love it

I think you have to split the intended uses of the DX. Amazon’s plan to promote the DX as a textbook reader has been largely if not completely a failure. Here there is a huge opportunity for iPad because textbooks can really leverage its much richer display capabilities.

The DX is much more impressive as a business or academic tool for the display of documents in PDF format. Here I think the significant competition comes less from the iPad than from the forthcoming Plastic Logic Que which, like the Kindle, is eInk based and will be able to display both PDF and Word documents.

Apple did not say anything about PDF support in the iBook app; they only mentioned ePub. You can convert between the two formats although ePub reflow can make a mess of highly formatted Acrobat documents.